When we talk about B2B e-commerce, an average audience will struggle after naming Alibaba. When we think of Alibaba’s GMV on Nov 2018 which was a staggering $30.8 billion, their popularity in public is well deserved. To gain this type of recognition, one has to prove that they are invincible and Alibaba has proved time and again that they are a force to be reckoned with.
With a huge audience at its disposal and a mindset willing to acknowledge the internet, the B2B industry is gaining traction. However, not all platforms are as lucky as Alibaba. This is the part where I tell you about the new trend in the B2B industry, known as vertical e-commerce. To persevere against the various policies surrounding Trading, a vertical e-commerce business model will prove to be an effective strategy for survival. After all, jack of all trades, but master of none will soon fade because he could not perfect a single trade.
The vertical e-commerce marketplace caters the requirement of a niche dedicated industry. Since this kind of market is completely oriented towards the needs of a particular group, buyers and sellers in the vertical industry are connected to increase operating competence and decrease supply chain cost, inventories and production period. Hence, a vertical B2B can be deemed as a platform for companies which sells to other business in one specific industry. This provides an advantage because the niche-focused vertical business is more familiar with trends, changes, regulation, and competition within the industry it caters.
Vertical e-commerce specialists are mavens, unlike horizontal B2B personnel. An online retailer who only deals in baby products or ladies shoes is a vertical B2B business. Vertical B2B is akin to the term “category killer” which is a retail chain store that is dominant in its product category. This type of stores generally offers an extensive collection of merchandise at good prices and huge variety that horizontal stores cannot compete with.
B2B platforms that are niche dedicated are able to showcase the product better, since they focus on one or a few product categories. Their inclined area of expertise allows them to engineer the user’s experience in a way that highlights the special features of the specified product category. For example, a retailer who deals in precious stones should use his platform to show how the stone glitters in different lights and any similar area which might spark the interest of his buyers. Likewise, an online pharmacy retailer for over-the-counter products might be able to write product descriptions that are apt to pharmaceuticals.
All niche inclined e-commerce platforms don't need to be vertical category retailer businesses. Vertical markets do not have to be industry-based, they can also be geographically based. A good example would be hyperlocal e-commerce sites who are niche players. These online retailers offer physical proximity and same-day delivery to its users. In this case, their niche is the locality in which they operate. Yet hyperlocal retailers do not get the term vertical attached to them.
THE BETTER METHOD
In the start, B2B industry was contented being horizontal. Regardless of the industry, focus of the business was diverted to a large number of customers. The idea was that adding categories in a virtual store only occupied bits and bytes and not real floor space; so might as well just sell everything.
It's not just about focusing narrowly on a product category. It is also about choosing a category that is suitable for a vertically focused e-commerce site. With too many B2B platforms in the game, the arrival of the vertical players heralded the next wave of e-commerce. The endurance for B2B platforms is hard as E-commerce is really a bubble and persisting it smartly will mark their survival. Presence on social media is now inevitable, not just for humans but for online stores. With so much information and variety at your fingertips, one wants value for money. Vertical B2B wizzes are known for their quality and high standard products which are available in bulk quantity for wholesale rates.
WHY DEFINING VERTICAL MARKETS IS BENEFICIAL
Other than value for money, there are countless other advantages as to why vertical e-commerce platforms could be the perfect solution for the overpopulated Ecommerce industry. From a customer's point of view, knowing vertical markets simplifies their shopping process and offers them a variety that focuses on serving their specific need.
Understanding of products:
Vertical platforms provide a deeper range of product. The specialists know their product better as compared to a horizontal platform’s specialist. Don’t you love it when you go for buying a product and be awarded tonnes of variety? From design, sizes, location of the manufacturer, to price range – vertical B2B sites provide you the freedom of selection from a plethora of options.
Heightened User Experience:
A vertical business knows exactly what you’re looking for. The filters on a B2B site are extremely intuitive. Once you apply desired filters, the site will read your mind and bring forward the most suitable products. Their in-depth consideration of user behavior stems from lots of research, surveys, and practical life examples. Vertical e-commerce sites will provide you a personalized experience in wholesale rates.
Reporting a problem to the right guy?
When there is a leakage problem in your home, you do not go looking for just any repair guy. You look for a plumber who specializes in fixing and handling water faucets and piping. Now think of a multinational corporation, they are looking for specialized services and they would blindly put their faith in a specialist. This person who is having experience aptly handles one aspect of their business. When a company is enabled access to specialize, it can perfect its product or service more easily and dominate the market.
Be ahead of the game!
Specialization leads to reduced competition, resulting in the market being able to sustain a higher price for a particular product or service. Where horizontal B2B markets are crowded, companies usually target verticals where there is an opportunity to innovate and buy something different at a lesser price. Less competition also translates to quicker and cheaper exposure in organic search results (SEO). Enjoy the exposure to a concentrated audience. There is more room for innovation and creativity.
Know your audience:
Vertical Markets enjoy the benefit of building a strong relationship with their buyers, suppliers, distributors, and retailers. Once these small businesses grow, the platforms grow with them. This results in a long lasting partnership with the existing and new clients. With concentrated audience businesses are more likely to meet experts from their field, from different geographical locations. This provides a better opportunity to connect and communicate with the right kind of audience furthering revenue generation. Sending out generic emails is not even an option in a vertical B2B platform.
Quality check:
In Vertical Marketing System or VMS, there is a centralized management system to maintain quality control of the product from manufacture to sale. If anything goes wrong midway, identifying and rectifying the problem is easy. International standards of quality are maintained to assure the superiority of the final product. Each product is validated through certified channels bringing nothing but best to the customers.
EXAMPLES OF SUCCESFUL VERTICAL B2B SITES:
Bizongo deals in affordable packaging products. Here you can get your hands on packaging solutions that are built to last and create minimal environmental impact throughout the lifecycle.
Website: https://bizongo.com/
BeauteTrade is B2B world’s fastest-growing online platform that caters the requirement of high quality and wholesome cosmetics and personal care products. It serves as a facilitation point for makeup wholesalers and retailers from different regions of the world.
Website: https://www.beautetrade.com/
Foursource deals as a digital sourcing network for the apparel industry. This platform helps buyers and clothing manufacturers to gain global market transparency and to manage their business relationships more efficiently.
Website: https://foursource.com/
CONCLUSION:
By fine-tuning B2B customer experience and becoming a sorcerer in a specific domain, vertical e-commerce has set itself up for smart survival and long term growth. B2B traditionally relies on relationships and networks, and introduction of niche-based platforms has started a trend in E-commerce which glorifies covering of A to Z details and a comprehensive understanding of the market, one can enter a vertical market and earn some big bucks. By focusing on one specific niche, you will be seen as the go-to-person in that industry. Get on the trend while it’s still new!